NY Times Features Special Report Entitled, “Arbitration Everywhere, Stacking the Deck of Justice”

The Article Is Critical of Enforcement Of Individual Arbitration In Situations Where Only A Class Action Can Be Economically Prosecuted.

     Jessica Silver Greenberg and Robert Gebeloff have authored a special report appearing in the New York Times online edition on October 31 and November 1, 2015, under the title:  “Arbitration Everywhere, Stacking the Deck of Justice.”

     The article promises to be “the first part in a series examining how clauses buried in tens of millions of contracts have deprived Americans of one of their most fundamental constitutional rights: their day in court.”

     The issues discussed in the article will be familiar with readers who have followed arbitration decisions of the Roberts Court.  Still, without offering too many spoilers, here are a few interesting tidbits:

• “More than a decade in the making, the move to block class actions was engineered by a Wall Street-led coalition of credit card companies and retailers, according to interviews with coalition members and court records.”
• Attorney John G. Roberts Jr. – now Chief Justice Roberts - represented Discover Bank when it unsuccessfully petitioned the Supreme Court to hear a case involving class-action bans.
• The NYT studied 1,179 federal class actions filed between 2010 and 2014 that companies sought to push into arbitration, and found that judges ruled in their favor in four out of every five cases.
• Though there is no central database for arbitration, the NYT concluded that between 2010 and 2014, only 505 consumers went to arbitration over a dispute of $2,500 or less.
• Verizon and Times Warner have arbitration clauses in their consumer contracts, and from 2010 to 2014, “Verizon, which has more than 125 million subscribers, faced 65 consumer arbitrations . . . . Time Warner Cable, which has 15 million customers, faced seven.”
• “One federal judge remarked in an opinion that ‘only a lunatic or a fanatic sues for $30.’”
• Andrew J. Pincus of Mayer Brown, succinctly states one of corporate America’s economic arguments for arbitration:  “Arbitration provides a way for people to hold companies accountable without spending a lot of money.”
• Last year, “attorneys general in 16 states warned that ‘unlawful business practices’ could flourish with the proliferation of class-action bans.”
• Examples of companies that now have arbitration clauses in their consumer contracts include Netflix, at&t, TimeWarner, T Mobile, ebay, Expedia, Budget, Discovery, Starbucks, and Electronic Arts.